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Spot robusta prices on ICE shot up to their biggest premium over forward contracts in more than a year on Tuesday as concerns about tightening nearby supplies in top grower Vietnam mounted as farmers there hoard stocks.

Stockpiling in Vietnam has touched off a three-week buying spree as investors raced for supplies, even as visible exchange stocks remained plentiful. Traders were also waiting for Brazil's crop, known as conilon, to hit the market.

July prices jumped more than 2 percent on Tuesday to $1,799 a tonne, the highest in nearly two months, having surged as much as 16 percent since late May.

On a continuation basis, the front-month contract went to a premium of $35 per tonne on Monday, its highest since March 2014, from a $14 discount to the second month a day earlier.

Wild gyrations in the spread between spot and second-month contracts are not unusual, but this week's moves were particularly dramatic, traders said.

It wasn't immediately clear what caused the sudden switch from a contango on Monday, although traders said it may have been a combination of higher demand due to Vietnam hoarding, options expiration on Wednesday and short-covering.

Some traders speculated roasters have been raiding stocks in ICE-certified warehouses rather than buying at origin in Vietnam, leading to greater demand even as inventories grow.

Stocks in Europe have increased as the cost of carry remains attractive, one European trader said.

Dry weather in Vietnam has raised some concern about next year's crop, while farmers have been hoarding beans in hope of higher prices.

"Weak spreads made people complacent, allowed specs to play the spread, and now they've been caught napping," the European trader said.

A U.S. trader said that several roasters had been in the market for robustas last week, having already stocked up on Brazilian beans for their blends.

The sudden turnaround came as July robusta options are set to expire on Wednesday with heavy open interest at $1,800 a tonne, a factor that can cause the futures contract to gravitate toward that price, traders said.

Open interest in July futures was at 43,065 lots on Monday, higher than usual with just two weeks left until first notice day before the contract expires on July 31.

Still, that was more than double the certified stocks held in ICE-nominated warehouses, which were 18,435 lots as of June 8.